Naturally Splendid Enterprises Ltd (CVE:NSP) (OTCMKTS:NSPDF) posted its unaudited financial results for the six months ended June 30 on Friday, noting that the coronavirus (COVID-19) pandemic slowed production and sales.
The company also said its manufacturing facility in Pitt Meadows, British Columbia, which focuses on developing and manufacturing plant-based nutritional bars and bites, recently passed its annual Safe Quality Food Level 2 (SQF2) annual audit. Such certification allows the company to focus on higher-margin product opportunities.
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Naturally Splendid recorded sales of C$1,025,636 during the first six months of 2020, compared to C$1,723,541 for the six months ended June 30, 2019. Revenues decreased significantly over the same period last year and gross profit margins are approximately 11% of sales, the company said. Selling and distribution costs of C$913,082 increased due to the increase in facility costs and inventory write-downs.
Gross profits decreased by almost 20% to C$112,562 (11% of sales) compared to C$531,496 (30.8%) for the first six months of 2019.
Naturally Splendid said it recorded a net loss from continuing operations of C$2,428,944 versus a loss of C$1,581,077 during the same period in 2019. That was mainly due to decreased production and sales due to the COVID-19 pandemic and increased facility costs and corporate promotion, the company said.
"Operating during these difficult times has not been without its challenges,” CEO Craig Goodwin said in the results statement. “Having said that, I am extremely pleased with the continued effort of our staff to operate under these trying times.
"Although not running at the same level of production as pre-COVID, we continue to service our existing contract manufacturing clients and anticipate adding new clients to our roster over the remainder of the year. We all are adjusting to the reality of the environment we are conducting business in and that includes our existing clients as well as new opportunities we are pursuing.”
Goodwin added that Naturally Splendid is preparing to begin its Phase 2 clinical for Cavaltinib to treat COVID-19 as part of a joint venture with Biologic Pharmamedical Research.
“We remain optimistic that this drug will provide a treatment option for those afflicted with COVID-19,” he said.
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